Questions
Unearned Fees appear on the
Unearned Fees appear on the
- a. balance sheet in the current assets section
- b. balance sheet as a current liability
- c. income statement as revenue
- d. balance sheet in the stockholders' equity section
In: Accounting
Prepaid insurance is reported on the balance sheet as a
- fixed asset
- current asset
- long-term liability
- current liability
In: Accounting
Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter.
Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter.
The company usually has to borrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter:
a. Budgeted monthly absorption costing income statements for April-July are:
|
|
April |
May |
June |
July |
|
Sales ... |
$600,000 |
$900,000 |
$500,000 |
$400,000 |
|
Cost of goods sold ... |
420,000 |
630,000 |
350,000 |
280,000 |
|
Gross margin ... |
180,000 |
270,000 |
150,000 |
120,000 |
|
Selling and administrative expenses: |
||||
|
Selling expense ... |
79,000 |
120,000 |
62,000 |
51,000 |
|
Administrative expense* ... |
45,000 |
52,000 |
41,000 |
38,000 |
|
Total selling and administrative |
|
|
|
|
|
expenses ... |
124,000 |
172,000 |
103,000 |
89,000 |
|
Net operating income ... |
$56,000 |
$98,000 |
$47,000 |
$31,000 |
|
*Includes $20,000 of depreciation each month. |
||||
b. Sales are 20% for cash and 80% on account.
c. Sales on account are collected over a three-month period with 10% collected in the month of sale; 70% collected in the first month following the month of sale; and the remaining 20% collected in the second month following the month of sale. February's sales totaled $200,000, and March's sales totaled $300,000.
d. Inventory purchases are paid for within 15 days. Therefore, 50% of a month's inventory purchases are paid for in the month of purchase. The remaining 50% is paid in the following month. Accounts payable at March 31 for inventory purchases during March total $126,000.
e. Each month's ending inventory must equal 20% of the cost of the merchandise to be sold in the following month. The merchandise inventory at March 31 is $84,000.
f. Dividends of $49,000 will be declared and paid in April.
g. Land costing $16,000 will be purchased for cash in May.
h. The cash balance at March 31 is $52,000; the company must maintain a cash balance of at least $40,000 at the end of each month.
i. The company has an agreement with a local bank that allows the company to borrow in increments of $1,000 at the beginning of each month, up to a total loan balance of $200,000. The interest rate on these loans is 1% per month and for simplicity we will assume that interest is not compounded. The company would, as far as it is able, repay the loan plus accumulated interest at the end of the quarter.
Required:
1. Prepare a schedule of expected cash collections for April, May, and June, and for the quarter in total.
2. Prepare the following for merchandise inventory:
a. A merchandise purchases budget for April, May, and June.
b. A schedule of expected cash disbursements for merchandise purchases for April, May, and June, and for the quarter in total.
3. Prepare a cash budget for April, May, and June as well as in total for the quarter.
In: Accounting
Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year
Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company’s balance sheet as of June 30th is shown below:
| Beech Corporation Balance Sheet June 30 |
|
| Assets | |
| Cash | $ 90,000 |
| Accounts receivable | 136,000 |
| Inventory | 62,000 |
| Plant and equipment, net of depreciation | 210,000 |
| Total assets | $ 498,000 |
| Liabilities and Stockholders’ Equity | |
| Accounts payable | $ 71,100 |
| Common stock | 327,000 |
| Retained earnings | 99,900 |
| Total liabilities and stockholders’ equity | $ 498,000 |
Beech’s managers have made the following additional assumptions and estimates:
1. Estimated sales for July, August, September, and October will be $210,000, $230,000, $220,000, and $240,000, respectively.
2. All sales are on credit and all credit sales are collected. Each month’s credit sales are collected 35% in the month of sale and 65% in the month following the sale. All of the accounts receivable at June 30 will be collected in July.
3. Each month’s ending inventory must equal 30% of the cost of next month’s sales. The cost of goods sold is 60% of sales. The company pays for 40% of its merchandise purchases in the month of the purchase and the remaining 60% in the month following the purchase. All of the accounts payable at June 30 will be paid in July.
4. Monthly selling and administrative expenses are always $60,000. Each month $5,000 of this total amount is depreciation expense and the remaining $55,000 relates to expenses that are paid in the month they are incurred.
5. The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30.
| (1) CASH COLLECTIONS SCHEDULE | ||||
| July | August | Sept | quarter | |
| From acc Receivable | ||||
| From July sales | ||||
| From august sales | ||||
| from Sept sales | ||||
| Total Monthly Cash Collection | ||||
| (2) MERCHANDIZE PURCHASE SCHEDULE | ||||
| July | August | Sept | quarter | |
| Budgeted COGS | ||||
| Desired ending Inv | ||||
| Total needs | ||||
| Beginning Inventory (Less) | ||||
| Required Purchases | ||||
| (2-b) MERCHANDIZE PAYMENT SCHEDULE | ||||
| July | August | Sept | quarter | |
| From account payable | ||||
| From July purchases | ||||
| From August purchases | ||||
| From Sept purchases | ||||
| Total cash disbursment | ||||
| (3) INCOME STATEMENT | ||||
| July | August | Sept | TOTAL | |
| Estimated Sales | ||||
| Less: COGS | ||||
| Gross Profit | ||||
| Less | ||||
| Net Profit | ||||
4) Prepare Balance sheet as of Sept 30:
In: Accounting
Calculate the unit product cost under absorption costing using the following information.
Calculate the unit product cost under absorption costing using the following information.
Direct materials: $50/unit
Direct labor: $75/Unit
Variable manufacturing overhead:$27/Unit
Fixed manufacturing overhead: $30,000
Units produced: 10,000
Units sold: 6,000
In: Accounting
P Company pays for purchases of materials in full in the month following the purchase
P Company pays for purchases of materials in full in the month following the purchase. During the previous month, IP had purchases of $25,000. During the current month, IP had purchases of $30,000.
The amount that IP will pay during the current month for purchases is ______
In: Accounting
Rogen Corporation manufactures a single product. The standard cost per unit of product is shown below.
Rogen Corporation manufactures a single product. The standard cost per unit of product is shown below.
| Direct materials—1 pound plastic at $7 per pound | $ 7 | |
| Direct labor—1.6 hours at $12 per hour | 19.2 | |
| Variable manufacturing overhead | 12 | |
| Fixed manufacturing overhead | 4 | |
| Total standard cost per unit | $42.2 |
The predetermined manufacturing overhead rate is $10 per direct labor hour ($16 ÷ 1.6). It was computed from a master manufacturing overhead budget based on normal production of 8,000 direct labor hours (5,000 units) for the month. The master budget showed total variable costs of $60,000 ($7.5 per hour) and total fixed overhead costs of $20,000 ($2.5 per hour). Actual costs for October in producing 4,800 units were as follows.
| Direct materials (5,100 pounds) | $ 36,720 | |
| Direct labor (7,400 hours) | 92,500 | |
| Variable overhead | 59,700 | |
| Fixed overhead | 21,000 | |
| Total manufacturing costs | $209,920 |
The purchasing department buys the quantities of raw materials that are expected to be used in production each month. Raw materials inventories, therefore, can be ignored.
(a)
Compute all of the materials and labor variances. (Round answers to 0 decimal places, e.g. 125.)
| Total materials variance | $ |
UnfavorableFavorableNeither favorable nor unfavorable |
||
| Materials price variance | $ |
Neither favorable nor unfavorableUnfavorableFavorable |
||
| Materials quantity variance | $ |
UnfavorableFavorableNeither favorable nor unfavorable |
||
| Total labor variance | $ |
FavorableNeither favorable nor unfavorable unfavorable |
||
| Labor price variance | $ |
UnfavorableFavorableNeither favorable nor unfavorable |
||
| Labor quantity variance | $ |
Neither favorable nor unfavorableFavorableUnfavorable |
In: Accounting
Schedule of cost of goods manufactured
Schedule of Cost of Goods Manufactured
The company reported the following information for the year:
Prepare a schedule of cost of goods manufactured for the year.
In: Accounting
Which item is included in the NIMS Management Characteristic of Accountability?
Which item is included in the NIMS Management Characteristic of Accountability?
A. Check-in/Check-Out of incident personnel
B. Maintain an accurate inventory of resources
C. Establish specific, measurable objectives
D. Conduct briefings as part of transfer of command
In: Accounting
Statement of cash flows indirect method
Preparing the statement of cash flows—indirect method
Use the Rouse Exercise Equipment data in Exercise E16-23. Prepare the company’s statement of cash flows—indirect method—for the year ended December 31, 2018. Assume investments are purchased with cash.
In: Accounting